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TAXATION OF BITCOIN AND OTHER CRYPTOCURRENCIES

The meteoric rise, and subsequent tailspin, in the price of bitcoin has incited rampant investment in cryptocurrencies. Over 1,400 coins or tokens are now in “circulation”. Often lost in the resplendence and chicness of buying and selling cryptocurrencies are the tax consequences.

At a basic level, cryptocurrencies (or “crypto”) are property for purposes of the Income Tax Act (Canada). As such, dispositions of crypto ordinarily give rise…

DONATING CAPITAL PROPERTY?

When capital property is donated, there is a disposition for tax purposes, which may result in a capital gain.  The fair market value (FMV) of the property donated is used as the proceeds of disposition, and as the amount of the donation.  In some circumstances it may be helpful to designate the proceeds amount to be an amount less than FMV.

If any “advantage” was received…

When to Incorporate your Proprietorship?

In our opinion, you should incorporate your proprietorship once it has proven to be a viable business and once it has begun to generate cash in excess of your living requirements, so that you can take advantage of the tax deferral opportunity available in a corporation.

Once you have satisfied the above two criteria and incorporate, you will then also benefit from creditor protection and the potential income splitting opportunities with other family members…

TRANSFERRING CAPITAL LOSSES TO A SPOUSE – YEAR END TAX PLANNING TIP

Capital losses can be transferred to a spouse or common-law partner by selling the loss shares, and having your spouse purchase those shares within 30 days.  You are denied the superficial loss, but the loss amount is used to increase the cost basis of your spouse’s investment.  Your spouse must hold the shares for more than 30 days for this to work.

Losses will also be disallowed if shares are 

TAX PLANNING TIP FOR YEAR END: ASSET PURCHASES

No matter if your business is operating through a proprietorship, partnership or corporation, the following planning can save you money.If you’re planning to purchase capital assets in the near future, consider doing so before the end of your fiscal year (this applies more to business with the year end December 31, 2012 which is coming up shortly). If the assets are acquired and in use…

FEW IMPORTANT TIPS AS YOU GATHER 2018 DOCUMENTS

As you gather all of your slips and receipts to bring to us, it is important to ensure you are gathering sufficient documentation in case of a CRA review/audit.  We have provided some useful tips below to ensure the documentation you have is sufficient:

Donation slips: For each donation made, get or request an official tax receipt. The receipt should have the date when the contribution…

Tax requirements for non-residents of Canada earning rental income

Non-residents of Canada who earn certain types of Canadian source income may be taxed on this income in Canada. Those that earn income from rental properties are taxed on this income in a very specific manner. Some of basic steps to know for non-residents earning rental income from Canada are:

Once the property is purchased find a good Canadian property manager to manage the rental property. Prepare…